Register with us today

and in less than 60 seconds continue your access to:Latest news headlinesAnalytical topics and featuresCommodities videos, podcast & blogsSample market prices & dataSpecial reportsSubscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Please Note: Platts Market Center subscribers can only reset passwords via the Platts Market Center

Enter your Email ID below and we will send you an email with your password.


  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you your password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber, to reset your password go to the Platts Market Center to reset your password.

In this list
Agriculture

US biofuel makers expect weaker demand from 2020 blending mandate

Electricity | Electric Power | Electric Power Risk | Renewables

US power sector faces challenges from lower utility load, global trade uncertainty

Agriculture | Biofuels

Platts Biofuels Alert

Commodities | Agriculture | Biofuels | Sugar

Miami Sugar Conference, 6th Annual

Commodities | Agriculture | LNG | Oil | Crude Oil | Petrochemicals | Shipping

US to raise tariffs on $550 billion of Chinese imports by 5 percentage points: Trump

US biofuel makers expect weaker demand from 2020 blending mandate

Highlights

Ethanol RINs fall after EPA proposes 2020-21 volumes

EPA declines to restore 2016 volumes flagged by court

Platts Analytics sees ethanol inputs above 10% this summer

Washington — The Trump administration's proposed 2020 biofuel mandate -- for refiners to blend 20.04 billion gallons, up less than 1% from this year -- could lead to flat or slightly lower US ethanol demand after factoring in small refinery waivers expected to be granted next year, Renewable Fuels Association President Geoff Cooper said Monday in an interview.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

Cooper said the implied conventional ethanol mandate of 15 billion gallons has created closer to 13.5 billion-14 billion gallons of ethanol demand because of widespread refinery exemptions the Environmental Protection Agency granted.

"Those volumes are below the E10 blendwall," Cooper said. "The [Renewable Fuel Standard] is not functioning to really drive growth in E15 and E85, and RIN prices are remaining low and not doing their job to push those higher blends into the market."

S&P Global Platts assessed D6 ethanol RINs for 2019 compliance at 21 cents/RIN and 2018 credits at 16.75 cents/RIN, both down 2.75 cents/RIN from the last assessment July 3.

RINs are tradable credits EPA issues to track production and use of alternative transportation fuels. For corn-based ethanol, one gallon of ethanol yields one RIN.

Refinery trade groups maintain that the small refinery waivers have not hurt ethanol production, sales, or demand.

Ethanol made up 10.1% of US gasoline supply in the week that ended June 28, up from a four-week average of 9.78%, according to S&P Global Platts Analytics. It sees ethanol remaining above 10% in upcoming weeks.

Platts Analytics expects a slight increase in E15 consumption in June, July and August, after EPA's recent approval of year-round sales of gasoline blended with 15% ethanol.

FLAT BIODIESEL MANDATE

EPA on Friday proposed volumes for its 2020-21 biofuel mandate, including 5.04 billion gallons of advanced biofuel, up from 4.92 billion gallons this year. That means the implied requirement for blending conventional ethanol remains at 15 billion gallons.

The mandate for blending cellulosic biofuel would rise to 540 million gallons in 2020 from 420 million gallons this year.

EPA wants to keep the 2021 biodiesel mandate at 2.43 billion gallons, prompting immediate criticism from biodiesel producers. The biodiesel requirement gets set an year ahead of the other categories.

Renewable fuel would make up 10.92% of US transportation fuel supply next year before any refinery waivers, if volumes are approved as proposed.

"The proposed mandates are in line with what we expected," said Corey Lavinsky, Platts Analytics director of global biofuels analytics.

The biofuel industry had hoped for a 2020 conventional ethanol mandate of 15.5 billion gallons, after an appeals court ruled in 2017 that EPA had improperly waived 500 million gallons in the 2016 mandate.

But EPA said in the proposal that adding the gallons retroactively "would be unduly burdensome and inappropriate."

"We are proposing to find that the applicable 2016 volume requirement for total renewable fuel and the associated percentage standard should not be changed," EPA said.

The Fueling American Jobs Coalition and American Fuel & Petrochemical Manufacturers both used the occasion of the RFS proposal to launch television ads calling on the Trump administration and Congress to protect refining jobs from the biofuel mandate.

EPA will accept comments on the proposed volumes before issuing final numbers by November 30.

-- Meghan Gordon, meghan.gordon@spglobal.com

-- Edited by Valarie Jackson, newsdesk@spglobal.com